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Banks Shed Internal Alternative Managers, Chance for Sovereign Funds

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public_funds_coastThe infamous Volcker rule, a Dodd-Frank Act provision, is being finalized – U.S. banks are being proactive and shedding assets. The rule prohibits banks from investing in any funds they do not manage. In addition, banks cannot invest more than 3% of their tier-1 capital in private equity or hedge funds.

As U.S. financial conglomerates continue to shed alternative asset managers like private equity and hedge funds, the asset management industry is ready to gobble them up with open arms. Just in August, Citigroup unloaded more than US$ 6 billion in hedge fund and private equity assets. Citi Venture Capital International, a private equity vehicle focused on emerging markets, was sold to The Rohatyn Group, a private equity fund managed by Nicolas Rohatyn. The Rohatyn Group manages around US$ 7 billion in assets. Remaining is Metalmark Capital, a private equity fund focused on North America, in which Citi is trying to negotiate a sale with fund management.

Sovereign wealth funds and public pensions could also be buyers of these asset management firms.

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Emirates NBD Acquires Turkey’s Denizbank in $3.2 Billion Deal with Sberbank

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In a bid to establish itself as one of the region’s leading providers of financial services, Emirates NBD – Dubai’s largest bank – has entered into a deal to acquire a 99.99% stake in Turkey’s DenizBank A.Ş. for a bargain price of US$ 3.2 billion from Russian state-owned lender Sberbank. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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Brazilian President Michel Temer Orders Liquidation of Sovereign Wealth Fund

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Brazilian President Michel Temer signed an executive order to shut down the country’s sovereign wealth fund. The money in the sovereign fund will go toward repayment of foreign debt.

The Sovereign Fund of Brazil, also known as Fundo Soberano do Brasil, was formed in 2008.

The formation of the Fundo Soberano do Brasil was authorized by then Brazilian President Luiz Inacio Lula da Silva.

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CDPQ Boosts Stake in Invenergy Renewables

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Caisse de dépôt et placement du Québec (CDPQ) boosted its ownership stake in Chicago-based Invenergy Renewables LLC. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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